Tech Stock Roundup: Strong Demand in AI Sector, MicroStrategy’s ‘Bitcoin Bank’ and Robotaxi Flop
Ken Fisher has increased his positions in Nvidia and Microsoft. l Credit: Derek Fenech/CCN.com
Key Takeaways
- MicroStrategy recorded a double-digit jump last week, outperforming the tech sector.
- Intel increased its market value after recent dips.
- Tesla lost 13% following its Robotaxi event.
The tech sector experienced a mixed bag of fortunes last week, with some companies soaring while others plummeted.
MicroStrategy’s ambitious “Bitcoin bank” strategy and strong earnings expectations for several tech giants fueled optimism. While Tesla’s underwhelming robotaxi event and broader market concerns weighed on other stocks.
Best of the Week
MicroStrategy led the pack of tech gainers last week, closing at $212.59 per share, a remarkable 20% increase. The company’s stock continued to rise in pre-market trading on Monday.
This surge is primarily fueled by MicroStrategy‘s ambitious plan to become a leading Bitcoin-focused financial institution . CEO Michael Saylor envisions the company as a “Bitcoin bank” that could reach a trillion-dollar valuation if Bitcoin’s price significantly appreciates.
Saylor outlined a strategy involving borrowing funds through various financial instruments to invest in Bitcoin, targeting an average annual return of 29%. He predicts that Bitcoin’s value could skyrocket to millions of dollars per coin, driving MicroStrategy’s valuation to hundreds of billions or even a trillion dollars.
Other notable gainers included Amazon and Intel , which increased by 1.2% and 4.3% respectively. Intel’s recently announced Core Ultra 200S series, set to launch on Oct. 24, has been touted for its lower power consumption. However, a CNET review found that the power consumption was not as low as advertised compared to competitors.
The Nasdaq 100 , the major tech index in New York, experienced a 2.4% increase last week.
Biggest Declines
Tesla’s stock plummeted 13% last week, making it one of the worst performers in the tech sector. The stock closed at $217.80 on Friday, with a significant 9% drop occurring that day alone.
The steep decline followed the company’s much-anticipated robotaxi event, which failed to meet investor expectations. During the “We Robot” event, CEO Elon Musk unveiled the Cybercab, a self-driving concept car characterized by its sleek, low-profile design and the absence of steering wheels or pedals. Despite the buzz around Tesla’s vision for a fleet of autonomous vehicles and robots, the event did not generate the excitement many had hoped for.
Musk indicated that production of the Cybercab could begin before 2027, but he did not provide details on the manufacturing location. He also announced that the price point for consumers would be under $30,000.
Additionally, Musk expressed optimism about achieving “unsupervised FSD” (Full Self-Driving) capabilities in Texas and California next year for Tesla’s Model 3 and Model Y vehicles. Currently, FSD is available in a “supervised” version for Tesla owners.
Tesla was not the only company to see declines last week; other tech giants also struggled. Alphabet, Google’s parent company, fell by 1.8%, like Advanced Micro Devices, while Meta Platforms decreased by 1.0%.
What To Watch
Several tech stocks are scheduled to report earnings this week. ASML Holding (ASML), a company in the electronics-semiconductor equipment industry, will announce its results on Oct. 16, 2024, with an expected EPS change of 7.0%.
Next, Netflix (NFLX) will report on Oct. 17, 2024, within the leisure movies and related sectors, where analysts anticipate a significant 37% increase in EPS.
On Oct. 17, 2024, Taiwan Semiconductor (TSM) will release its earnings, with expectations for a 42% increase in EPS, reflecting its position in the electronics-semiconductor manufacturing industry.
Infosys (INFY), which operates in computer-tech services, will report on the same day, expecting an 8.0% change in EPS.
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